Dollars and sense

Too many people are scared of money. Most of us like to have it, spend it - even save it.

But far too many seem to think that "people who are good with money" are some sort of secret club - and, unless you sailed through maths at school, there's no hope of ever joining it. They couldn't be more wrong.

It's Money Week this week and one of its key messages is how a good understanding of finances is important to the quality of your life.

Simple decisions can make a big difference to how well off you are, particularly when it comes to saving for retirement. Put it in the too-hard basket and you risk short-changing yourself.

Financial-service providers are being urged to work hard on making things easy for consumers to understand.

If you want to sort your finances, here's a few tips on where to start:

Check out your debt: If you've got lots of debt, try to consolidate it to cut the interest rate. If you're looking for a personal loan, don't just go to the company that makes it seem the easiest - find out what interest rate you are being offered.

Look at your KiwiSaver: Find the fund that's right for you. If you're not sure, get your provider to advise you. Ensure you contribute at least $1042 a year so you get the money from the Government.

Check your spending and saving: It can be easy to spend money if you haven't put it away.

Review your spending habits over the last few months and work out the amount you could save if you made a few changes - you may be surprised.

Set up your direct debits for payday, so you know they will clear and you aren't charged unnecessary fees for overdrafts or failed payments. This should also give you the opportunity to claim all the prompt payment discounts available to you.
If there's something you don't understand, ask. It's not a secret code and, if your financial-service providers can't explain things in a way you understand, it's their failing, not yours.

- Jeremy Tauri is an associate at Plus Chartered Accountants